FERC Audits Two Market-Based Rate Sellers "“ Reaction to Ninth Circuit Lockyer Decision Concerning Reporting Requirements for Market-Based Rate Sellers?

FERC announced in April that it would begin auditing power sellers with market-pricing authority for compliance with demanding quarterly reporting requirements. The audits plainly come in response to the dubious court decision in Lockyer v. FERC and signal to all market-price sellers the need to heighten their attention to accurate quarterly reporting both in the past and going forward. Last September, the Ninth Circuit US Court of Appeals ruled that wholesale power sales under a market-based tariff, if not individually detailed in quarterly filings with FERC, were "pragmatically" sales with...

U.S. Supreme Court Will Not Review Decision Prohibiting Courts from Ruling on Wholesale Power Prices

Fallout from the 2000-2001 western energy crisis persisted in April. In a case involving one of the relatively smaller claims to arise out of the crisis, on April 18, 2005, the US Supreme Court denied the petition of the State of California for review of a lower court ruling that only FERC can decide whether the state was unlawfully double-billed for wholesale power. In a claim filed in state court in 2002, California alleged that certain generators violated the state's unfair business competition laws by double-billing the California Independent System Operator ("CAISO") over $100 million...

Benefits of ISOs and RTOs "“ ISO-NE Results Show Lower Prices, Increased Investment and Improved Efficiency, Reliability and Environmental Action

In its recently published "Progress of New England's Restructured Electric Industry and Competitive Markets: The Benefits of ISOs and RTOs," ISO-New England ("ISO-NE") lauds the long-term performance of its power market. Since the market's inception in 1999, New England wholesale electricity prices have declined by 5.7 percent, after adjustments for fuel costs, and the fuel-adjusted price decline experienced from 2001-2004 was 11 percent. Also during this time, ISO-NE estimates that more than $9 billion was invested in new power plants, and up to $4 billion was invested in transmission...

New England Set to Implement Day-Ahead Demand-Response Market Beginning June 1

The New England Power Pool and the ISO New England finally won FERC approval in April to expand their demand-response bidding beyond real-time to the day-ahead market ¾ the Day-Ahead Load-Response Program or DALRP. This approval joins other recent regulatory recognitions that conservation can often prove the least-cost answer to perceived supply shortages. When the new program goes into effect June 1, a firm-demand New England customer can elect to become a demand resource by registering in one of ISO-NE's load-response programs and then be able to offer demand reduction in the day-ahead...

FERC Asks for Comments on the Roles of RTOs and ISOs in Establishing Reference Prices for Mitigation

On April 1, 2005, FERC invited comments on the roles of Regional Transmission Organizations ("RTO"), Independent System Operators ("ISO"), or their market monitors in establishing reference prices to be used to lower or "mitigate" wholesale power prices deemed to be non-competitive. Public comments were due to FERC by May 2, 2005. Several RTOs and ISOs "• including the New York ISO, ISO-New England, California ISO, and the Midwest ISO "• use "conduct and impact" tests in their wholesale day-ahead and real-time electricity markets to determine whether to apply mitigation to assure just and...

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